Scammers are a creative lot and they will try to get your cash by any means possible.
Although the scams are endless in design, there are three main things they will try and do:
- Steal your identity
- Get access to your money
- Scam you into investing in or buying their products.
In this blog we look at the most common scams and see why we fall for scams. Our next blog will show you how to spot a potential scam and then point you in the right direction if you are affected.
Stealing your identity
Your identity has value. Fraudsters can use it to:
- Apply for loans and benefits in your name. Stealing the money and potentially leaving you responsible for the bill
- Create bank accounts in your name to launder their illegal money
- Create fake identities for illegal immigrants to access the country and get jobs.
And when they are finished with it, they can even make money selling your information to other fraudsters.
On top of potentially running up bills in your name, identity theft can cause other problems in your life. It can destroy your credit rating, making it hard for you to access loans, mortgages, mobile phone contracts…
There are three main ways a scammer can get your personal details:
- Hack your accounts and read your information
- Search your social media for information, where they might find your name, address, date of birth, address, car registration number… all in one handy place
- Ask you for it and wait while you hand it over.
Getting access to your money
Scammers want your money, and what better way to get it than having you give it to them! The main approaches they will use are:
- Tricking you into moving money into their accounts for safe keeping
- Gaining access to your accounts and taking what they want
- Leading you into a romantic relationship to capture your heart to give them money. Once the money runs out, the relationship ends
- Pretending they can give you money, but you need to pay ‘legal costs’ to get it.
Scamming you into investing in or buying their products
Scammers will sometimes try and get you to part with your money by offering you great deals. Unfortunately, they either won’t deliver or what you get won’t be anything like what’s promised.
The most common scams are:
- Selling fake products, that are poor quality at best or downright dangerous at worse
- Creating investment schemes with amazing returns, only to run off with the money and leave you with worthless investments.
Scammers will try to tempt you with ‘get rich quick’ schemes, enticing you to part with your hard-earned money.
Why do we fall for scams?
The most powerful tools a scammer has are your emotions. They will:
- Get you to trust them
- Get you to panic
- Get you to fear missing out
- Get you excited by the great deal you are going to get.
The best scammers make use of more than one emotion at the same time. So what should you look out for in each of these?
How do they get you to trust them?
- Pretend to be in a position of authority. E.g. the police or HMRC
- Pretend to be from a trusted company. E.g. a bank, the post office or Amazon
- Use the image of a trusted person. E.g. including a photo of Martin Lewis, the money saving expert
- Copy the look and feel of a trusted company. E.g. having a name and logo similar to a trusted brand
- Pretend to be part of a trade body. E.g. claiming they are registered with the FCA
- Spend time to build a relationship with you. E.g. chatting to you on social media platforms and dating apps
- Create a website link that looks real. E.g. security.hsbc.ttgrxads.com is not the HSBC website, it’s part of the ttgrxads.com website. Remember, what’s in front of the last dot com (or dot co.uk) is the real website. They can put anything they want in front of that
- the real link to report fraud at HSBC is: https://www.hsbc.co.uk/help/security-centre/report-a-problem/
How do they create panic?
Panic on its own is not enough, they also need your trust. But panic has two effects: it makes you quicker to react and makes you trust quicker. There are two simple ways to create panic:
- Tell you your money is in danger
- Tell you your accounts have been compromised.
Both of these get your heart beating, lower your judgement and make you do what they want, be it to click on a link or tell them your information.
Fear of missing out
Classic FOMO. We all fall for it at times: Black Friday sales, limited time only deals, nights out with friends when we have other plans.
When the call or email arrives telling you about the great deal, the clock is ticking. Should you/shouldn’t you? This is your last chance…
FOMO can lead to rushed judgement and scammers know it.
Excitement
“I made £20,000 in 2 months”, “Our investments have risen by 700% in the last 6 months”, “Bitcoin has risen by £10,000 in the last year”…
What an opportunity! You are going to be rich! The excitement for how rich you are going to be blinds you to the scam that’s going to hit you!
What to do now?
In our next blog we explain how to spot a scam and what you can do to protect yourself.
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